Among the many, Tether (USDT) is the largest stablecoin—a type of cryptocurrency linked to the actual value of a US dollar. This means that it is supposed to have a stable value, and in theory, a single unit of it should be worth something significantly close to $1. So why does USDT quickly become a favorite for those in cryptocurrency? USDT is bankable and is favored due to a variety of reasons, including, most importantly:
- Hedging against volatility: The cryptocurrency market can be highly volatile. Holding USDT allows you to park your funds in a relatively stable asset without completely exiting the crypto ecosystem.
- Enabling trades: Most cryptocurrency exchanges only allow trading between coins. USDT acts as a bridge that will enable one to easily convert from fiat currency—like USD—into other cryptocurrencies.
- Fund transfer: USDT transactions are usually quick and cost less as compared to bank transfers.
This will guide you if you are somewhat new to the crypto world and want to learn about how to buy USDT.
Selecting a Platform for Buying USDT
The first step in buying USDT is to select a credible platform. There are two major ways to do this:
- CEXs are an online exchange form that operates as an intermediary between cryptocurrency buyers and sellers. They are very user-friendly and accept many forms of payment, making them suitable for beginners. However, using this type of exchange generally means they hold custody over your cryptocurrency, and in most cases, direct control over private keys is out of the question. Some of the best-known examples of CEXs include Coinbase, Binance, and Kraken.
- Peer-to-peer (P2P) Marketplaces offer direct buyer-seller connections with negotiable terms and prices. Further, since P2P marketplaces have you holding the private keys in your funds, you can retain more control over your funds compared to a CEX. Nevertheless, this may compromise experience levels for users unfamiliar with the mechanics of handling crypto funds, and in P2P transactions, completion usually takes more time. Established P2P marketplaces that support USDT include Paxful and LocalBitcoins timeartup.
Factors to Consider in Choosing a Platform
Here are a few of the main factors to consider when deciding which platform to use for buying USDT:
- Security: Choose a platform with a strong security reputation and robust safety features, such as two-factor authentication.
- Fees: Compare transaction fees, deposit fees, and withdrawal charges across platforms to determine the best costs for transactions.
- Payment methods: Ensure that the platform accepts your preferred payment method, which could be through bank transfer, credit card, or debit card.
- Regulation: Some jurisdictions have regulations that may limit access to some crypto platforms. You may want to make sure by checking your own legal decisions.
Buying USDT on a Centralized Exchange (CEX)
We will use Coinbase as the example here to give one a better idea of how it would look to purchase USDT from a CEX. These steps should be similar across most platforms, albeit with minor differences.
- Open an account: You can visit the Coinbase website or download the app on your mobile phone. Submit your personal information and verify it.
- Deposit Funds: Proceed to fund your account once your account is successfully verified. This can be done by transferring money from a bank, credit card, or debit card.
- Buy USDT: Click on the “Buy/Sell” menu item and select USDT from the list of options. Enter the amount in USDT you wish to buy or the amount you would like to spend. Then, verify information regarding the transaction and fees or terms.
- Store Your USDT: Once your acquisition is complete, it will be deposited in a USDT-denominated Coinbase wallet. You can leave it on the exchange or send it to an off-site wallet for better security.
Purchase USDT Using Peer-to-peer Marketplaces
Here is a summary of how to buy USDT at a peer-to-peer marketplace like Paxful:
- Sign Up: Click the register button to open an account on a P2P marketplace.
- Get an offer: Find sellers who have listed offers to sell USDT and filter based on your preferred payment method and price.
- Initiate a trade: Choose any seller’s offer; upon selection, the platform will initiate a trade and hold his USDT in escrow until you have made the payment.
- Complete the payment: Vendors will be instructed on how to complete the payment with a preferred method. After the vendor confirms receipt, the USDT will be released from the platform to your wallet.
It can be straightforward to buy USDT, primarily through a centralized exchange and for beginners. Nevertheless, one has to be careful about the platform to be used, the fees associated with it, and keeping security measures in mind. So, follow the above steps and take care with due diligence; anyone can really quickly and safely buy USDT nowadays.
